The COVID-19 crisis has made it even more important for Europe to set its priorities right and investing in high-impact projects. As European policymakers discuss the framework for the next European Union (EU) budget and the Recovery and Resiliency Facility instrument (RRF), energy efficiency and system integration in heating and cooling should be key drivers for the green recovery objective.

Why heating and cooling for a green recovery?

Representing 50% of energy consumption, heating and cooling is a key sector that needs to embark onto the green transformation. Heating, cooling and hot water make up close to 80% of the final energy use of households, while industrial process and space heat demand make up 70% of businesses’ energy consumption[1]. Heating and cooling supply and demand is very much based on local circumstances, as it cannot be transported far away like other energy carriers. Therefore, financial resources invested in greening this sector will directly benefit European citizens and local businesses.

More than 70% of heating and cooling supply is neither efficient nor renewable. Moreover, renovation rates have remained modest over the past years. These impediments have been flagged by the European Commission in its Renovation Wave and Industrial Strategy communications.

What are the available solutions?

To address the challenges of heating and cooling decarbonisation, there is a need for local strategic planning of demand and supply, efficiency and renewable energy, as well as all energy infrastructure in an integrated way.

Numerous studies have shown that there is no single solution to decarbonise heating and cooling. Accounting for the diversity of energy users, geographies, existing infrastructure at local level and specifics of the building stock, a mix of green heating and cooling solutions should be deployed as soon as possible.

On the demand side, there is ample potential for building renovation and industrial process efficiency, as well as digitalisation, controls and demand response. Concerning the supply of heating and cooling, a win-win strategy will be the uptake of efficient, decentralised generation combined with the switch to renewable sources in both electricity and gas carriers.

System integration solutions like high-efficiency cogeneration will play a key role in modernising heating and cooling between now and 2050[2]. Reducing energy consumption across all fuels will ensure higher uptakes of renewables. Supplying renewable and low carbon heat at times of high demand will help reduce the burden of heat electrification on the power system. Moreover, supplying flexible electricity at times of insufficient wind or sun will further improve system efficiency and resiliency.

EU Member States are already looking into the best mix of heating and cooling solutions for the future as part of their obligations under the Energy Efficiency Directive and the Renewable Energy Directive. The so-called national Comprehensive Assessments on Renewable and Efficient Heating & Cooling (CA H&C) are due at the of 2020 and should guide Member States, industry and local authorities towards green investments in the sector.

How can RRF help?

Member states must commit to prioritising green investments through their recovery and resilience plans. Immediate emissions, efficiency and air quality benefits can be achieved by modernising district heating and cogeneration or replacing old boilers with innovative micro-cogeneration.

Given the diversity of local circumstances, rigid EU level criteria may stifle rather than promote fit for purpose solutions on heating and cooling. Linking the RRF to the outcome of the national CA H&C will ensure an ambitious and flexible approach for much needed investments in the sector. Accounting for the system integration and energy efficiency in heating and cooling as part of the recovery plans, will be key in accelerating EU’s energy transition and boosting local economies at the same time.

[1] https://ec.europa.eu/energy/topics/energy-efficiency/heating-and-cooling_en?redir=1

[2] https://www.cogeneurope.eu/knowledge-centre/cogeneration-in-2050